Direct investment activity reached US$213 billion in the third quarter of 2025, –an increase of 17% year-over-year. Year-to-date transaction volumes have now increased by 21% compared to 2024. The Americas posted particularly strong gains as transaction activity rose 26% in the third quarter led by the United States. EMEA investment volumes were 19% higher than last year in Q3, with the UK and Germany the two most liquid markets while Spain, Sweden and Belgium all posted robust growth. Trends were more nuanced in Asia Pacific where direct investment declined by 8% year-over-year. Activity in Japan remained strong despite the normalization of borrowing rates, with volumes rising by 16% year-over-year.

Cross-border investment has continued to recover in spite of geopolitical pressures, with third quarter growth of 7% year-over-year and year-to-date volumes 26% higher. The share of cross-border flows into each of the regions has remained relatively steady so far in 2025.

Future trends: Demand returning despite ongoing supply chain uncertainty

Short-term: The implications of new trade policies will continue to impact planning and inventory strategies into 2026 and beyond. Demand from 3PL and distribution companies will keep rising to support more agile outsourced distribution management, while deferred decisions will gradually return to the market.

Long-term: The longer-term shape of trade policies and supply chain reconfiguration is still evolving, which will slow overall decision-making. However, delayed transactions are adding to the future pipeline, while drivers including the regionalization of higher-value manufacturing, growing defence spending, rising e-commerce and urbanization are expected to underpin future growth.

Following the elevated growth seen in 2022 and 2023, global revenue per available room (RevPAR) trends are normalizing further. Europe is leading RevPAR growth, followed by Asia Pacific, with the pace of growth moderating in the Americas. Global urban markets should continue to see further increases, pushed by lower new supply and expanding group and corporate travel. 

Future trends: Global hotel brands prioritize unit growth over management contracts 

Short-term: With slowing new supply, hotel brands are using their balance sheets to boost unit growth via M&A, strategic partnerships and conversions. The global portion of franchised hotels (i.e., those managed by third parties) is expected to increase further, creating opportunities in the highly fragmented third-party management space with new players, increased partnerships and M&A likely to emerge. 

Long-term: The global travel landscape is undergoing a significant transformation with markets like India and Saudi Arabia poised to play increasingly significant roles in shaping future travel patterns, driven by shifts in demographics, economic power, and consumer preferences. As consumers increasingly focus on experiences, traditional hospitality brands are expanding their offerings to new verticals, boosting the growth of lifestyle hotels.